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Homework answers / question archive / The following information applies to the questions displayed below] Web Wizard, Inc
The following information applies to the questions displayed below] Web Wizard, Inc., has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $40,000 on credit b. On January 31, the company estimated bad debts using 1 percent of credit sales. c On February 4, the company collected $20,000 of accounts receivable, d On February 15, the company wrote off a $100 account receivable e. During February, the company provided services for $30,000 on credit 1. On February 28, the company estimated bad debts using 1 percent of credit sales. g. On March 1, the company loaned $2,400 to an employee, who signed a 6% note, due in 6 months. h On March 15, the company collected $100 on the account written off one month earlier. On March 31, the company accrued interest earned on the note J. On March 31, the company adjusted for uncollectible accounts, based on an aging analysis (below). Allowance for Doubtful Accounts has an unadjusted credit balance of $1,200.
Customer Alabama Tourism Bayside Bungalows Others (not shown to save space) Xciting Xcursions Total Accounts Receivable Estimated Uncollectible (%) Total $ 200 400 17,000 400 $18,000 Number of Days Unpaid 0-30 31-60 61-90 Over se $ lee $ 80 $ 20 $ 400 6,800 8, 4ee 1, eee see 400 $ 7,300 $ 8,480 $1,020 $ 1,2ee 2% 10% 20% 48%
Required information Assets Liabilities Stockholders' Equity
urnai entry worksneet 11 > 2 8 1 3 4 5 6 7 Record service revenue of $40,000 sold on account during January. Note: Enter debits before credits Debit General Journal Transaction Credit a Record entry Clear entry View general Journal
14 WEB WIZARD, INC. Partial Balance Sheet At March 31 Assets Current Assets Accounts Receivable, Net of Allowance
4. Sales Revenue and Service Revenue are two income statement accounts that relate to accounts related to Accounts Receivable and Notes Receivable that would be reported whether each would appear before, or after, Income from Operations. Web Wizard would report Income from Operations. Income from Operations.
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